It is about the national picture but I also think people can see what we are trying to do here.

"For too long it has been short-term politics in Oldham and it's felt directionless but now we have a chance to do something long-term."

Mr McMahon, who became the youngest council leader in the country last year at the age of 30, added: "We now have some big plans and big decisions to make. We want to bring in 2,000 jobs in the next two years. We want to move quickly on things such as bringing in a hotel and a cinema. We want to bring investment to Oldham."

In Shaw, Liberal Democrat leader Howard Sykes, who ran the council until Mr McMahon took over, managed to hold onto his seat unlike many of his colleagues.

He put the result down to national issues.

Mr Sykes said: "It's clearly down to what is going in in the government. It has actually not been as bad as it could have been. We've not lost as many seats as we did last time.

"I think the big story is the turnout which is the lowest I have witnessed in 25 years. I don't know why it's so low. It's not as though people don't have things to moan about."

He added: "I'd like to thank my constituents for recognising the hard work that I put in."

The Conservatives failed to field candidates in two of the wards they previously held.

Former party leader Jack Hulme, who stood down from his seat and retired, was magnanimous, despite a disappointing night for his party.

He said: "I think things have come full circle. I stood here four years ago - when Gordon Brown had introduced that ridiculous 10 per cent tax - with a majority of 780 which was staggering.

"But things change and I don't think Jim (McMahon) could have picked a better date if he had the chance to. It's been a horrendous month for us and the elections could not have come at a worse time."

Mr Hulme, 74, added: "I am proud of being involved in the appointment of Charlie Parker (the town's chief executive) and I think his ability to intract investment, coupled with the freshness Jim has brought to the role, should stand Oldham in good stead."

Perhaps the story of the night came in Failsworth East.

There Labour candidate David Dawson romped to victory in one of two wards the Conservatives chose not to defend.

His victory was a poignant one - his wife Barbara, a councillor in the same ward - passed away last week.

"Wherever she is she'll be looking down and smiling," said Mr Dawson.

"I took a lot from her. This is the first time I've stood and her experience taught me a lot.

"We were both angry with what this government is doing, especially to young people and I wanted to do something."

Mr Dawson, who will bury his wife next week, added: "She'll be delighted."

With no election next year and a majority of 29 with a safe seat by-election to come Labour are set for two years of dominance,

A beaming Mr McMahon added: "We've got an appetite and we want to deliver."

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Labour will be aiming to strengthen their grip on Oldham. The Red Rose party currently hold 34 seats compared to the Liberal Democrats' 21 and the Conservatives' five. Thanks to national issues - and what many have seen as a strong performance at local level - they will be hoping for substantial further gains to cement their position.

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